MM361-Financing Entrepreneurship

Module Provider: Leadership, Organisations and Behaviour
Number of credits: 20 [10 ECTS credits]
Level:6
Terms in which taught: Autumn term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2018/9

Email: m.belitski@reading.ac.uk

Type of module:

Summary module description:

Entrepreneurs often find access to finance and sharing equity problematic. This module introduces students to the various forms of financing for entrepreneurship (e.g. debt, equity financing, non-for-profit and alternative financing) and venturing with limited resources. We overview the entrepreneurial ecosystem approach to demonstrate how entrepreneurs can act to attract finance to pursue profitable opportunities. 

Aims:

Using the entrepreneurial ecosystem approach, which refers to the system of social and economic incentives created by various economic agents, and affecting the entrepreneur decision-making (Mason and Brown, 2014), the module will critically examine the nature, role and importance of different sources of finance for entrepreneurial ventures, assess their availability, costs and benefits for an entrepreneurial firm at different stages of growth. 

The module content is designed to provide a better contextualisation for ICM263 Venture Capital, which has a more technical approach.

Assessable learning outcomes:

Intended learning outcomes:

Demonstrate a critical understanding of theoretical and practice elements underpinning entrepreneurial finance. 

Assessable learning outcomes:

By the end of the module it is expected that the student will be able to: 

Apply theory to create a crowdfunding pitch for angel investors, venture capitalists, private equity and other ecosystem stakeholder. 

Learn how to evaluate investment projects, including under uncertainty and open information. We evaluate a company’s performance to conduct a cash flow analysis and a project appraisal.

Assess and compare the stakeholders and resources within the entrepreneurial ecosystem of a region / country in order to decide on the market making strategies and access to financial resources.  

Additional outcomes:

Students will have to work both independently, and in groups, leading to the development of time-management and team working skills. Preparatory guidance and formative assessment will be provided for group work. Such skills are important for future employment and professional development.

Outline content:

- Introduction to Entrepreneurial Ecosystem, stakeholders and the role of Entrepreneurial Finance 

- Corporate VCs, Business Angels and Venture Capital as a source of entrepreneurial finance

- Government and Universities as a source of entrepreneurial finance 

- ‘Alternative’ forms of financing, including peer-to-peer lending, B-to-B lending, equity and reward based crowdfunding.

- Investment decision making in markets with perfect information when successful entrepreneurs need to demonstrate good judgement in making risky innovations according to assumptions on costs, revenues and profit margins known as “Casson’s synthesis” (Casson (1997).

- Investment decision making under uncertainty. Tree of decisions.

Global context:

The course uses cross-country comparisons of entrepreneurial finance which makes the outcomes generalizable for both developed and developing countries.

Brief description of teaching and learning methods:

The module will consist of lectures (10x2) and seminars (3x1). During this time the main topics on the syllabus are covered. Students are encouraged to actively participate in discussions during these sessions and share relevant work experiences. 

Tutorials will incorporate individual cash flow and investment appraisal analysis; group work and presentation on a case study with calculation and a comprehensive set of financial ratios working on balance sheets to evaluate a company’s performance. Seminars end with question and answer session. 

Students are expected to read key references and to do a significant amount of independent research using the Internet, journals, and academic references

Summative assessment- Examinations:

Summative assessment- Coursework and in-class tests:

One individual task of 2,500 words, covering a major area of investment decision making in the syllabus (5%). To be submitted during week 9 of Autumn Term.

One group presentation of 10 min on a new business venture covering a major area of equity crowdfunding and financial analysis and running a crowdfunding campaign using Sandpit  educational tool  (50%). During week 11 of Autumn Term.

Formative assessment methods:

Group exercises and group presentation during the class. Verbal feedback will be provided during lectures and tutorials.

Penalties for late submission:

Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information: http://www.reading.ac.uk/internal/exams/student/exa-guidePG.aspx



Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information: http://www.reading.ac.uk/internal/exams/student/exa-guidePG.aspx

Assessment requirements for a pass:

A weighted average mark of coursework and oral presentation, crowdfunding campaign of 50%.

Reassessment arrangements:

Additional Costs (specified where applicable):

Last updated: 20 April 2018